LAND MATTERS 16.0.
THE LAND USE CHARGE AND ITS IMPLICATIONS FOR LAND OWNERSHIP
Recently, the Lagos State Government implemented a new Land Use Charge Law (LUCL), 2018. The LUCL repealed the Land Use Charge Law, 2001 and provided for a standardised and regulated system, much clarity in the formulae for calculating the charge as well as possibility of self-assessment.
The Law with 27 sections harmonised pre-existing land charges and attempts to increase the revenue base of the State by capturing more payers.
Opinions are widely divided as to the (un)fairness of the Law, and these have been expressed in several critical reviews.The concern here is not a reproduction of these reservations or of the provisions of the Law itself. We seek to draw inferences of the perceived implications of the Law for land ownership.
At first glance, it is the concern that the burden of payment of the charge can easily be pushed to tenants. Unlike the repealed 2001 Law, the new Law identifies 'owners or occupiers' of a lease as having the obligation of payment. It is true that the government has insisted that property owners are the one to pay, but such inelegant drafting can be exploited by unconscionable landowners. Given the housing deficits problems of Lagos State, tenants would have no choice but swallow the bitter pill. This reinforces the street slogan that: only the poor pay taxes!
Perhaps more compelling is the ripple effects of the Law on the property market. To maintain their rent profits, landowners will increase rents to meet up with the new reassessment. Although this will increase the value of properties generally, it will also invariably result in increased cost of living. In this condition, only tenants get to suffer the consequences. Isn't it time you also become a landowner?
POST SCRIPT:
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